Lending products to form 20% of Flipkart’s growth: Ravi Garikipati

Flipkart hopes to see lending products like “buy now pay later” and “cardless credit” for consumers contribute to 15-20% of the platform’s growth over the next three years

About 60% of Flipkart’s over 100 million customers do not have access to credit, and the company is looking to close the gap by offering financial products to them as well as its sellers, said senior vice-president Ravi Garikipati, who was put in charge of the fintech vertical in November last year. Walmart had said that Flipkart has over 54 million active customers, during the announcement of its $16-billion deal in the Indian company.

Flipkart expects fintech to become a significant revenue generator as well as a profitability driver, as it aims to address affordability for customers with credit products as well as other financial products such as insurance. It will also revive its seller financing and look to be competitive in the SME lending segment.

The “buy now pay later” product already has 6-8 lakh users, with a 60% repeat rate, and now about 80 lakh Flipkart customers are eligible for it, Garikipati said.

Flipkart will also push cardless credit focused with the new-to-credit consumer segment, for which it has tied up with an NBFC.

“The roadmap is to take consumer financing to other online ecosystem players after extending it to portfolio companies (Myntra and Jabong),” Garikipati said.

Flipkart itself has already applied for an NBFC licence. The company will take a hybrid approach, looking to take a good chunk of the loan book while also creating a curated marketplace of lenders.

“Affordability products will be driven by the company’s own balance sheet for consumer financing, especially for people without access to credit,” Garikipati said.

The company will start off with microlending and micro-insurance for ecommerce purchases on its website, with a long-term plan of moving to products such as general and life insurance.

Flipkart is also looking to co-create new insurance products aligned with ecommerce, such as mobile protection insurance, including theft insurance and damage, and return shipping coverage for sellers, Garikipati said.

“Every big consumer company is a potential fintech company,” said Vidhya Shankar Satyamurthy, executive director of Grant Thornton India. “They have massive data and see it as a big opportunity